A new core banking software vendor – Nymbus – has launched its new-generation product aimed at community banks and credit unions in the US.

The system is dubbed Smartcore and is offered on a fully hosted basis. The vendor is keen to take on the well-entrenched, traditional players in the US market, such as FIS, Fiserv, Jack Henry and D+H.

‘We are the Rebel Alliance fighting the Dark Forces of the “big four” vendors,’ says Nymbus CEO Alexander Lopatine. He feels there is a lot of support for the Nymbus initiative among the financial institutions in the US. ‘We are the good guys and everyone wants to help us.’

The roots of the Nymbus offering stem from a sister company, Mediaspectrum Inc. This company specialises in the publishing domain and provides content management system (CMS) platforms to media moguls in the US and internationally. USA Today is among its customers.

Nymbus’ co-founders are Lopatine and Scott Killoh, a co-developer and founder of the Openpages CMS (Openpages is now owned by IBM). Killoh is also chairman of Mediaspectrum.

Nymbus has its HQ in Miami Beach. It targets all of the US community banking and credit union space, and already claims around ten takers of its core system.

The vendor initially pitched its product to larger banking entities, but found that their sales cycles and decision-making processes were too long. So it turned to the lower-tier sector and found it to be a happier hunting ground.

Also, having just one or two large banks as customers makes the vendor too dependent on them, observes Lopatine. ‘The value of the company, in my opinion, is higher if it has hundreds of small FIs as clients rather than just two large ones.’

The first client was a community bank in Florida, says Lopatine. The bank originally was interested in a new CRM/front-end solution, but discovered that it would be too expensive and cumbersome to integrate with its existing mainframe core. It turned out to be a much better deal to replace the entire front-to-back office set-up altogether, he adds.

This client is set to go live in mid-2016. By the end of that year, all current takers are set to be live on Smartcore.

Old vs new

‘Old core systems out there in the US today are about batch processing,’ Lopatine says. ‘Imagine the publishing industry working the same way – imagine US Today not being able to sell, process and post an online advert here and now – that just would never happen, it is simply unimaginable.

‘I used to work in banking as well as retail sectors, so I am not just a tech guy, and I look at everything from three perspectives.

‘So when we looked at our CMS platform for publishers, we realised that we have a “bank in a box”. The platform has the workflow tools, sophisticated integration tools, relational database and CMS.’

It was decided to spin off the platform into a separate business, and this is how Nymbus was born.

The project kicked off in early 2014.

‘Held hostage’

‘Community banks and credit unions in the US are being held hostage by the big core processors,’ Lopatine states. Old generation technology, lack of innovation, high costs and the necessity to maintain big IT teams – this is what many financial institutions have to deal with, he claims.

He compares a mainframe solution to a 1970s car. ‘Is a 1970s car more robust? It has more spare parts, more metal, but it does not make it more robust! It has no airbags or seatbelts, it is clunky, it has no touchscreen radio and so on.’

Nymbus, he adds, wants to be ‘the Tesla of banking’.

Miami Beach, Florida – home of Nymbus

A new hope

Changes in old systems require coding, which can be expensive, time and resource consuming, he says. New generation software, meanwhile, is all about configuration, not coding. Products, APIs and reports can be ‘created on the fly’.

‘We are the first full stack API driven platform,’ Lopatine says. The system is HTML5, browser-based. There are no legacy components, and it is built in Java.

The system is supplied on a fully hosted basis. The company has two data centres in the US and one in Europe.

The system supports front-to-back office operations and is supplied as one package, ‘defined by functions’. There is no separate teller, business intelligence (BI), online or other subsystems, Lopatine explains. He feels that smaller entities would benefit from an end-to-end solution that will take care of all their needs, from processing at the back-end to user- and customer-facing functions at the front-end.

‘Our aim is to empower smaller credit unions and community banks to compete with large mega banks,’ he states.

The proposition

Fully hosted. A private cloud, single-tenant environment.

Unlimited storage for documents and images.

No deposits, cost-effective. ‘We do not want to be very cheap because we offer so much more,’ states Lopatine. ‘But we are not more expensive than the others. In the long run, we are cheaper as we offer paperless processes, no need for servers and bit IT teams.’

Assistance with digital marketing and a new website. ‘Many community banks and credit unions still don’t have a website or have a very old one, yet a website today is a major selling channel,’ Lopatine observes.

Fast time-to-market for new products. Configuring new products and reports in-house (there is a widget for this, so a customer might not need to involve Nymbus at all).

Annual subscription, which includes a certain number of support hours per year.

24×7 concierge services for customers.

Regular upgrades.

Easy to scale up.

No lengthy training. ‘The system is intuitive,’ says Lopatine. ‘All you need to know is banking.’

What’s to come

An audit by the Federal Financial Institutions Examination Council (FFIEC), a US government interagency body that includes five banking regulators, will be done in early 2016.

Loan origination functionality, which is currently in the development phase, will be available by mid-2016.

Nymbus will complete its acquisition of a small core banking software developer and its clients will be converted to Smartcore.

By the end of 2017, Nymbus aims to have 50 customers converted to Smartcore.